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US law firms hand London associates spring bonuses of up to £47k

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Milbank, Skadden, Paul Hastings and Goodwin Procter splash the cash 🤑

Milbank, Skadden, Paul Hastings and Goodwin Procter join a growing number of US law firms awarding their London associates with special spring bonuses of up to $64,000 (£46,500) in recognition of their endeavours throughout the coronavirus pandemic.

Milbank is awarding associates in the US, London, Brazil and Asia with cash awards in April and September 2021 for their efforts “during what continues to be a challenging and busy period”, according to a firm memo published by Above The Law.

They’ll receive between $4,500 (£3,300) and $24,000 (£17,400), depending on experience, on 30 April, and a second bonus five months later on 30 September, ranging from $7,500 (£5,400) to $40,000 (£29,000).

To put these figures into context: a 2013 qualifier at the firm will receive the maximum $64,000 (£46,500) bonus spread across the two months, while a 2020 qualifier will receive $12,000 (£8,700).

It’s worth noting that these hefty cash rewards will not impact any discretionary bonuses Milbank pays out at the end of the year, which it expects will be no less than last year’s bonus pool.

“The firm is off to a great start to the year and your tireless dedication, resilience and enthusiasm have allowed us to deliver the highest level of client service, while remaining engaged with the Milbank community and serving the broader communities where we live and work,” said Scott Edelman, partner and chairman of Milbank, in the memo. “We appreciate your talent and commitment and want to share the firm’s financial success with you.”

Milbank’s London lawyers aren’t short of cash. Legal Cheek‘s Firms Most List shows newly qualified solicitors earn $190,000 (approx. £132,000), making them among the highest paid in the City. They also received “special one-time bonuses” in recognition of their efforts during the coronavirus pandemic last autumn.

The 2021 Legal Cheek Firms Most List

Skadden, meanwhile, has announced special spring bonuses of its own, but is awarding these in June and December 2021.

They range from $6,000 (£4,400) and $32,000 (£23,200), again depending on the level a solicitor is qualified, to be paid on June 30, and a second round of the same payments to be awarded in December. The total amount of money they’ll receive matches Milbank’s scale.

Skadden also clarified the sums will be in addition to its regular year-end bonuses which it expects will be no less than the 2020 scale.

Skadden’s London lot earn upwards of £133,000 according to our Firms Most List.

Paul Hastings has decided to throw its hat in the ring. The LA-headquartered firm will give out between $12,000 (£8,700) and $64,000 (£46,500) to associates in the US, London, Asia, Frankfurt and São Paulo offices. The financial awards will be distributed in May and October 2021, and are intended to be separate and apart from any year-end discretionary bonus paid in respect of 2021, Above the Law reports.

Goodwin Procter is also handing associates in the UK, US, Luxembourg and Hong Kong, bonuses of the same range in July and October 2021. The firm confirmed to Legal Cheek that to be eligible for these payments, associates must meet an annualised hours threshold of 1,850 hours.

Goodwin’s goodwill extends further to trainee solicitors, who’ll receive $4,000 (£2,900).

“We recognise how hard you are working and that this is a challenging period on many levels. This special bonus is important and necessary, but it will not ameliorate all of the competing demands on your time,” said Robert Carroll, partner and attorney review committee chair, in a firm email sent to associates last night. “We hope that you can put these special bonuses to good use to further your wellness and wellbeing.”

In other news, Linklaters and Addleshaw Goddard join a number of UK law firms awarding their lawyers with ‘COVID bonuses’. Links is handing all staff a one-off payment of 5% of their salary, mirroring moves made by magic circle rival Clifford Chance this month, whilst AG is giving everyone a bonus of £1,500.

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58 Comments

A disinterested barrister

The US firms are making the Brits look like chumps.

lol

Word on the grapevine is the MC are planning an Easter bonus of prestige – watch this space…

SPB Associate

Will the likes of SPB be doing this as fellow US shops?

Topkek

LOL YEAH 😂😂😂

A

Maybe when associates start billing 2000 hours/year

Show me the money

join a real firm- problem solved

Kirkland NQ

Welcome to the Lambo owners club – nice of you to finally join us.

Joe

The title makes it sound like each lawyer awarded a bonus will be getting 47k when that’s just not true

Tutor

Did you not read the bit that says “up to”?

Back to BPP, Joe.

Tom

I work at a job where people can earn “up to” six figures.

I personally only make 20k and so do the majority but sure let’s say “up to” which reflects the couple of senior staff.

Tutor

Yes, but you’ve still chosen to ignore the ‘up to” in giant letters at the top of this article

Attention to detail

This is why you’re only earning 20k!!!

Baker Botts PE NQ

Maybe not at your firm 😉

CMS Senior Associate

I own a Lambo and I work at CMS- just been saving up for last twenty years and living in a tent for those 20 years but I’ve got one all the same

Kirkland NQ

What’s the point in having a Lambo if you don’t have a Chelsea townhouse to park it outside of?

flourpour

That ought to give enough of a dopamine rush to fuel their exhausted minds through the weekend’s work.

Uj

For the avoidance of doubt, some of the firms aren’t actually paying the discretionary bonus payment so this is in lieu. They’ll say you haven’t made target hours or they are writing off billable time.

Troof

That’s just not true is it. The full emails from each of those firms make clear that year end bonuses will be paid out in the bands/amounts no less than the financial year just gone.

Durham Grad

When do their vac scheme applications open? Asking for a friend

Dan

The fact that Addleshaw Goddard awarded their lawyers a £1,500 bonuses whereas Goodwin gave £2,900 to their trainees….

X

Goodwin seem to be hiring new partners every week at the moment. They’ve poached like 3 partners from K&E in the last 2 weeks….

Anon

Lol “poached”. Hoovered you the also-rans already marked for the exit is more like it.

Anon

Yet Goodwin still doesn’t appear on LC’s Most List!

Anonymous

the only bonus we get is the bonus backside kicking we get when the partners are feeling particularly Dickensian on a given day

Hmm

Can anyone shed any light on how much extra billing (I’m talking revenue) people have been pulling at these firms in order for bonuses like this to be handed out?

US Associate

It’s not reflective of revenue or hours, this is just the US law firm market. When one major US firm (Davis Polk) announces, the rest all follow and this just gets translated across the pond to the London offices.

All bonuses are contingent on being on track to hit billable hour targets (typically 1600 – 1800) and if you aren’t on track come June you can still earn the full bonus amount in Dec if your hours have picked up.

Pretty crazy. An NQ at one of these firms is going to be earning approximately £155,000 in 2021.

Anon

Compare that to the UK / MC firms who also follow each other – just in the opposite direction in cutting NQ salaries in a race to the bottom. An NQ would be taking up to 65k more all in this year at the elite US shops for working the same hours.

Lol

1600-1800? Try adding at least 500 to that

US Associate

Just incorrect. No firm has a requirement to hit 2000+ billable to get a bonus.

However, the reality is that at any top US firm (or magic circle for that matter) you will be billing 2000+ hours in 2021. We are in the busiest period for M&A and PE that there has ever been and the top firms are extremely busy, such is the nature of this period.

Don’t think that just because the US firms are giving these bonuses that they are getting any worse blasted than their magic circle counterparts. Both sets of firms are crazy busy at the moment and if you find yourself in a transactional team at any top firm you will be working extremely long hours this year.

Correction

An old thread and I note this sadly has 20 upvotes, but it is entirely wrong. My US firm has a 2000 hour requirement and my previous one 2150, which is exceptional.

There are plenty of US firms with 2000 hour targets and indeed it is closer to the norm at most. Every firm is different e.g. I don’t think Sidley has a billable target.

US 2nd yr

I don’t know what dept you are in or firm you are at, but Q1 2021 has been absolutely crazy – I think revenues will be through the roof. While these firms are following Davis Polk, it is almost certainly a product of how busy everybody has been and is 100% tied to the current billing levels.

US Associate

At one of the top US firms and it’s been crazy yes. Am at 625+ billable for 2021 already along with a lot of others in our office. Same for a lot of people I know at other firms.

Anon

That’s just over 200 hours per month. Hardly “crazy”.

Roger

1,850 hours a year sounds like a nightmare.

My target is 1,500 hours and even that is more than enough for me. I’m happy enough with my lower salary and almost non-existent bonus. It pays the bills and I still have my life.

Dan

no bonuses at MoFo…

lol

What is MoFo? lol

Peter Freeman

Freshfields boasting about unprecedented performance and yet no COVID bonus. Pathetic.

Caution

Remember why they are earning these bonuses, cos they are working crazy long hours..there’s always a sacrifice.

Sad Pathetic Peasant

Meanwhile back in Legal Aid land on the chicken feed salary of £50K I get to have time to spend with my wife and kids, indulge in hobbies, days out, holidays and see family and have friends who aren’t just work colleagues. All while really enjoying the interesting day job.

What a sad sad loser I am.

Anon

Will working at one of these firms as an associate make you materially better-off in the long run? Will the extra savings make a material difference?

Anon

It has for me. I’ve stashed every penny and it’s made a material difference to my long term prospects and how long I’ll have to work even if my shelf life is short.

The basic salaries are very high, the normal year end bonuses eye watering and the special bonuses are on top of that. The money is significant and for a mid level associate is more than salaried partners at even some top 20 London firms.

Offshore phatman

Not in the UK it won’t: HMRC will roger you so hard on your gross pay only crumbs will be left. Remember that after tax, a whack of £150k is £12,500 gross but only ~£7,553 net. That’s right, the HMRC just gimped you out of five grand for nothing.

If you really want to make big dolla, it is necessary to the Middle East or Asia, or offshore if you can hack the tiny island life.

HTH

anonymouse

This is why you should pay heavily into your pension on these salary levels – there’s a 60% tax saving between £100-125k, a 40% tax saving between £125k-150k, and a 45% tax saving after that. Whack in £150-200k in the first couple of years or so of qualification and watch that double every 10 years 🙂

Roflcopter

Wtf are you going on about pinhead? Whack what in, given the taxman takes close to 50% of your gross? What about rental/mortgage payments, bills, day-to-day spending?

Head back to your LLB textbooks mate, you’re talking smack again.

Anonymouse

You get your tax back when you put money into a pension. So a £25k contribution by salary sacrifice if you’re earning £125k p/a would only cost you £10k net (and would also defer a further circa £2.5 of student loan payments if you’re paying these resulting in a paycheck reduction of only circa £7.5k). If you bring your salary under £100k via salary sacrifice you also remove the need to do a tax return.

Speak to a financial adviser if you’re a lawyer actually earning a salary and not an LLB student as it sounds like you could do with some educating here.

2014 qualifier at one of these firms

A 2014 corporate or finance associate at some of these firms (not all of these firms by the way) will be on about £225k base, roughly £70k year-end bonus and £45k special bonus so you’re talking £340k comp package for this year. You can fairly assume that you will be doing a minimum of 2,000 billable hours a year to get all of that. Take home pay for the year will be about £191k. It’s up to the individual to decide if that’s worth it or not. Note that your pension allowance reduces vastly at these sort of figures and the max you’ll be able to get in will be about £4k which would probably get taken up by your firm’s contribution.

The point is, even after tax, the pay is on another level compared to any of the other UK or mid-Atlantic paying US firms. There’s no right or wrong answer but if money motivates you then working at these shops will not disappoint you (financially).

Anonymouse

On the pension point, tapering is why it’s important to get as much in at an early qualification level, before you lose your annual allowance. Note you can look back 3 years so even if you’re into tapering territory you can use the unused annual allowance (£40k p/a) for the past 3 years (up to £120k in total, albeit that would be reduced by any contributions you and your employer put in during that period).

2014 qualifier at one of these firms

That’s right. I was lucky enough to be able to do this and max out my allowances right from the beginning. I can’t believe it when people don’t take advantage of it but I guess it’s dependent upon each individual’s personal circumstances. I think it’s a no brainer.

Anon

Yes you can save 100k plus at these firms as a mid/senior level. Do that for 5 years and you can leave with 500k cash. Walk into a 125k a year inhouse job for a 9-5

Keep the porkies coming

Rofl where do you come up with this crap? Back to your first year LLB textbooks you go. 😀 😀 😀

Anon

What about when you take into account mortgage payments and interest as part of that. Do you count principal mortgage repayments as money “saved”?

Anonymouse

In reality you generally need to remortgage every 2 years (to stay on a low rate as they move to a standard variable rate, which is usually far higher – eg 1.5% for the first two years and then 4.5% standard variable rate). When remortgaging you can release the cash used on repayments and put it in your ISA or whatever, so yes, it does count as saving.

It makes sense to pay back a mortgage up to a point, but once you LTV is low enough to get a cheap interest rate (eg I pay 1.2% with 70% LTV but paid 2.2% when I had 90% LTV when I first bought) your cash will work more efficiently in an ISA (mine is in a tracker which returned about 80% over the past 5 years).

Qanon

If you get £230k + 80k annual bonus + 50k COVID bonus then you can save 7k per month and still have a 2.5/3k a month mortgage if you wish.

Lol

Who the hell is going to be earning that?! You’re talking about a handful of senior associates in London … don’t forget the extortionate tax and living expenses either

Anon

Not sure it’s right that only a “handful” earn it. There are maybe two thousand associates in the city working at Kirkland, Latham, Milbank, Weil, Goodwin, Proskauer, Skadden, Debevoise, Cleary, Ropes, STB, Willkie, Davis Polk, Paul Hastings, Cooley. All of those firms have announced these spring bonuses, and most pay the Cravath scale or close to it. On the Cravath scale, a 2017 qualifer for example will earn $364k this year with bonuses included.

Rage

Not all of these firms are paying out in London, just to be clear

Anon

Happy to be corrected. Do you know which ones aren’t?

Eagerbeaver

Legal Cheek pls can you keep an eye on this and keep the pressure on the rest of the US firms in Ldn? We are ridiculously busy but still no sign of the firm matching this for us – pretty sure we are doing better numbers than these firms that have been mentioned. Do your duty LC!

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